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Mediation enters third day as Israel Folau seeks $14 million payout from Rugby Australia

Israel Folau and Rugby Australia's mediation over the sacking of the former Wallaby will head into a third day, as both parties look to reach a settlement to their legal battle.

Maria and Israel Folau leave Federal Court on December 2, 2019 in Melbourne, Australia Source: Getty

After a 12-hour meeting at the Federal Circuit Court in Melbourne on Monday, Folau and Rugby Australia resumed mediation over the phone on Tuesday in a bid to stop the case heading to trial.

Folau's lawyer George Haros said on Monday they remained "hopeful to reach an amicable agreement".

"Where we stand is that mediation remains on foot."

Folau is seeking $14 million in compensation after his contract was terminated in May.

The former rugby league and AFL player claims he was wrongfully dismissed by Rugby Australia and Rugby NSW after a controversial Instagram post in April condemning "drunks" and "homosexuals" and warning "hell awaits" them.

"I understand that not everyone shares my faith and some find it difficult to reconcile with their own beliefs," Folau said in a video posted on his website before the meeting.

He has stopped all social media activity since August, when he announced the start of his proceedings against Rugby Australia.

Rugby Australia says it will not provide any further comment until the mediation process is completed.

Previously, RA chief executive Raelene Castle said a tribunal found Folau had committed a high level breach of his contract and he had refused to curb his social media use.

"Rugby Australia is confident in its legal position but we come here today with a genuine desire to find a settlement that is sensible and reasonable so that we can return all our focus and resources to growing the game of rugby across Australia," she said on Monday.